Cryptocurrency vs Mutual Funds: Where Should You Invest? Blog / By Imperial Money / May 29, 2021 / bitcoin, cryptocurrency, cryptocurrency vs mutual fund, dogecoin, Finance, Investment, lumpsum, Mutual Fund, SIP, What is better to Invest?, Where Should You Invest? Cryptocurrency vs Mutual Funds: What is better to Invest? Everything in the world, whether man-made or natural, has its value and keeps fl uctuating constantly. The concept of money was fi rst used thousands of years ago as something to trade for. Only in 600 B.C, the concept of currency in the form of coins and paper was invested. The concept of money or currency has evolved into a much complex system since then. This interests people to invest in things whose value tends to go up over time to grow their money. Over time, di ff erent ways of investments have been developed and are still constantly on their way to invention. This blog speci fi cally revolves around two types of investments, namely – Mutual funds and cryptocurrency which is the most talked-about investment vehicle. What is a mutual fund? And how does it work? Most of us know about mutual funds or have at least heard of them. Well, a mutual fund is a fi nancial vehicle that consists of a pool of money from various investors which goes in securities like stocks, bonds, money market & nowadays in real estate as well. Mutual funds are managed by professional fund managers whose aim is to make capital out of investments made by people. Any gain or loss is proportionally shared by each shareholder of the mutual fund. What is cryptocurrency? And how does it work? “ Crypto has a chance of becoming Digital Gold, ” says Former US Treasury Secretary . Cryptocurrency or crypto is a digital currency used in peer-to-peer electronic cash systems over the internet. Cryptocurrencies are decentralized i.e. there is no centralized authority to govern them, and they work based on a blockchain system. Archives March 2023 February 2023 January 2023 December 2022 November 2022 October 2022 September 2022 August 2022 July 2022 June 2022 May 2022 April 2022 March 2022 February 2022 December 2021 November 2021 October 2021 September 2021 July 2021 June 2021 May 2021 April 2021 February 2021 November 2020 October 2020 September 2020 August 2020 July 2020 June 2020 March 2020 February 2020 January 2020 December 2019 October 2019 September 2019 November 2018 July 2018 Search ... CLIENT LOGIN Home About Us Services MF Tools Research Blog Contact Us Bitcoin is one of the most famous types of crypto. Bitcoin along with many others is limited in number unlike other types of currencies which can be increased if needed. Cryptocurrency is discovered or mined by solving complex mathematical problems. Some other famous cryptocurrencies are – Ethereum, Litecoin, Bitcoin Cash, etc. The question arises – which of them is better for investment? Parameters Mutual funds Cryptocurrency Source The existing assets and their values. Most cryptocurrencies are fi nite in number and are yet to be mined completely. Risk Comparatively low risk High risk due to uncertainty and volatility. Returns 5% – 15 % annually Fluctuates annually from 1318% in 2017 to -72.6% in 2018 to 87.2% in 2019 to 302% in 2020 Additional costs Very Low Transactional Fees Very low transactional fees Medium of investment Through fi nancial advisors or online platforms. Online through any crypto trading application or crypto exchanges, Quantity The potential is not fi nite and is measured by the value of assets. Most cryptocurrencies are fi nite in number and are yet to be mined completely. Legalities It is legal and regulated by SEBI in India. Using crypto is legal but it is not recognized by any Central government across the globe. So then, who wins? Well ... the answer is no one. Both of them are not always compatible as an investment option. Where should one invest depends on various factors but the most important one is “ Risk appetite ” . As mentioned in the above table, both of them have di ff ering returns and thus way di ff erent risks associated with them. Apart from its uncertainty, crypto faces one major issue that is – since it ’ s decentralized it is very di ffi cult for it to become a form of currency. On the other hand, big corporates like Apple and Amazon are in favor of crypto as a currency, and that is why it has now become a tricky issue and constantly appears in fi nancial news. Now few more data for your understanding. Only 100 people across the globe are holding 13% of BITCOIN with their individual capacity. 40% holding of all BITCOIN globally holding by 2500 unknown accounts. That is how single trade by 1 account holder in fl uence and generate very high of volatility. We believe looking into the all parameters we have to choose sensible and realistic products and services which suit our risk pro fi le. No matter where and how you choose to invest, it is quite understood that planning is the key. It is highly recommended that you consult a fi nancial distributor for your hard-earned money to safely grow for your future needs. Imperial Money Private Limited is one such fi rm that provides personalized fi nancial services and wealth creation activities. This organization is an expert in mutual fund distribution and systematic investment products. Imperial money aims at sensible investment and customer satisfaction. In conclusion with this analysis, there are always di ff erent ways to invest and grow your money. People need to choose the right option for them keeping in mind their capacity and ability to cope up with the outcome. HAPPY INVESTING!!! 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